Missed Questions Flashcards
(38 cards)
Physical deterioration is considered curable whenever
A
it is caused by lack of maintenance.
B
it does not result in loss of economic utility.
C
it costs less to correct than the resulting value increase.
D
it can be repaired regardless of the cost.
C
it costs less to correct than the resulting value increase.
For example, let’s say an older office building needs to update electric and add bathrooms, repartition offices and fire safety features to meet code for resale. The cost to complete the work is estimated at $2.2 million. However, the building is fully paid for and can easily be sold for $4 million. In this case, curing the defects makes sense. However, if those numbers were reversed, as is often the case, demolishing the building and starting over with a new structure or different use (e.g., retail space, a parking garage, etc.) would be the wiser choice.
The primary purpose of a deed is to
A prove ownership. B transfer title. C give constructive notice. D prevent adverse possession.
B
transfer title.
A deed is the instrument by which ownership of a property is transferred from one person to another, while a title is evidence of that ownership.
Carl Chauvinist, the owner of an apartment complex, lives in one unit of a triplex and routinely refuses to rent either of the other two units to a female. Can he do this?
A
Yes. He may do this if he does not use a broker or discriminate in advertising.
B
Yes. He may do this if he doesn’t ask the tenant’s age.
C
No. Carl can never discriminate on sex.
D
No. Carl must live in a single family home to discriminate.
A
Yes. He may do this if he does not use a broker or discriminate in advertising.
Although laws vary by state as to number of units that fall under this type of provision, if a person owns and lives in a unit, he or she is entitled to practice a certain measure of discrimination. The view is that a person’s dwelling (which includes units such as duplexes and triplexes) enjoys a degree of “sanctity” and the person may choose whom he or she brings into their “home.” Therefore, the owner could claim an exemption from federal Fair Housing laws.
Which of the following provides a buyer with the best assurance of clear, marketable title?
A Certificate of title B Title insurance C Abstract of title D General warranty deed
B
Title insurance
Title insurance provides the best assurance of marketable title.
In general, the Foreign Investment in Real Property Tax Act (FIRPTA) requires a buyer to withhold estimated taxes equal to ____ of the sale price in any sale or exchange of property owned by a foreigner (not a US citizen).
A 3% B 5% C 15% D 20%
C
15%
Congress passed the Foreign Investment in Real Property Tax Act (FIRPTA) to eliminate the problem of collecting delinquent taxes from foreigners who owned and sold property in the US and left the country without paying the taxes due on the sale. The IRS currently keeps this 15% to ensure that any capital gains on the sale are paid.
________ refers to using or altering existing listing information or keywords that are copied from one Internet site and posted or displayed for the benefit of the general public in front of a firewall at another site, without written or electronic authorization and disclosure of ownership.
Scraping
Scraping refers to using or altering existing listing information or keywords that are copied from one Internet site and posted or displayed for the benefit of the general public in front of a firewall at another site, without written or electronic authorization and disclosure of ownership.
The covenant in a deed which states that the grantor is the owner and has the right to convey the title is called
A covenant of power. B covenant of warranty forever. C covenant of seisin. D covenant against encumbrances.
C
covenant of seisin.
Another outgrowth of the feudal system, “seisen” derives from the French meaning to “sit upon or own” and gives owners the right to sell or transfer property at will.
A broker and seller terminate the listing contract. An offer is received in the mail by the broker after the termination of the listing contract. The offer is for full price and includes all of the terms and conditions of the seller. Why is this NOT a valid contract?
A There is no consideration involved. B No acceptance has been given. C No earnest money has been enclosed. D There is no current listing agreement.
B
No acceptance has been given.
It’s talking about the actual contract
It has not been presented to or accepted by the owner. Remember, contracts aren’t valid until both parties agree. However, even though the listing agreement has expired, the offer should be presented. If it’s accepted and the transaction closes, the broker will generally be entitled to his or her full commission.
Any licensee who violates any of the provisions regarding escrow accounts may be judged to have endangered the public interest and may be subject to
A License revocation.. B A temporary license suspension. C A fine of not more than $5000 per violation. D A fine and possible imprisonment for felonious comingling.
B
A temporary license suspension.
According to Illinois law any licensee who violates any of the provisions regarding escrow accounts may be judged to have endangered the public interest and may be subject to a temporary license suspension.
At what age is a person considered "elderly" under the Illinois Human Rights Act? QID: 2392505Mark For Review A Over 62 B Over 40 D Over 55 D Over 45
B
Over 40
According to the Illinois Human Rights Act, “elderly” is defined as anyone over 40 years of age.
A mechanic’s lien would be properly classified as a(n)
A equitable lien. B voluntary lien. C general lien. D statutory lien.
D
statutory lien.
A “statutory lien” is one that arises out of specific law (otherwise known as statutes). By contrast, an “equitable lien” has its roots in common law or custom. A “voluntary lien” is one entered with the property owner’s knowledge and consent, such as a mortgage. A “general lien” grants a creditor the right to file a claim against all of a debtor’s assets, not just a particular property. Liens are often categorized as more than one type. A mechanic’s lien is statutory AND involuntary, for example.
What do liens and easements have in common?
A
Both are encumbrances.
B
Both must be on the public record to be valid.
C
Neither can be done without the consent of the owner.
D
Both are money claims against the property.
A
Both are encumbrances.
Liens are, of course, serious in that they indicate the owner has failed to pay a debt secured directly or indirectly by the property. Easements, on the other hand, are generally a practical necessity for most residential properties.
How many members of the Board must have been a salesperson or broker for a minimum of 10 years prior to
A 4 B 9 C 12 D 7
C
12
Twelve members shall have been actively engaged as managing brokers or brokers or both for at least the 10 years prior to the appointment, 2 of whom must possess an active pre-license instructor license.
The system of ownership of real property in the United States is what?
A Incorporeal B Allodial C Command D Feudal
B
Allodial
“Allodial” is the modern form of ownership and is often contrasted with “feudal” in which land is held on the condition of rent or service due the government. For example, a medieval knight held property subject to coming to his baron’s service when called. Similarly, the baron’s land holdings were conditional on his raising an army and fighting for the king in times of conflict. Failure of any party to “perform as promised” was cause for holdings to be confiscated, often as a preliminary step to more extreme actions.
James a property manager must maintain all security deposits in an escrow account for the duration of the lease, unless the
A
Tenant indicates to James that he/she waives the requirement.
B
James the broker has less than five property management lease contracts.
C
Lease is for less than three years.
D
Tenant waives this requirement in writing. If such a waiver is included in the lease, it must be in bold print.
D
Tenant waives this requirement in writing. If such a waiver is included in the lease, it must be in bold print.
According to Illinois law a property manager must maintain all security deposits in an escrow account for the duration of the lease, unless the tenant waives this requirement in writing. If such a waiver is included in the lease, it must be in bold print
Which is the best example of functional obsolescence?
A residential home built next to a factory
B
Peeling paint
C
A house with no electricity or running water
D
A residential home with central air conditioning
C
A house with no electricity or running water
“Functional obsolescence” typically shows itself in one of two forms: first, in poor initial design, as in this case; second, when the features and design of the home have become outdated compared with competing properties.
For the past 30 years Lois has operated a neighborhood grocery store. Last week the city council passed a zoning ordinance that prohibits packaged food sales in the area where Lois’s grocery store is located. The store is now an example of a/an
A illegal enterprise. B nonconforming use. C violation of eminent domain. D variance of the zoning laws.
B
nonconforming use.
This is an example of “grandfathering” that’s common when new zoning rules are put into place. Basically it means that businesses and buildings that were in compliance before the new code was established may continue to operate or exist under their present owners. However, if Lois want to sell her business, it must be to an enterprise that meets the new requirement.
An appraiser is usually paid
A
a fee based on a percentage of the appraised value.
B
a fee based on the amount of time and effort.
C
a fee agreed upon after the appraisal is completed.
D
a standard fee agreed upon by the National Appraisal Association.
B
a fee based on the amount of time and effort.
There are two fundamental reasons for the “time and effort” rather than valuation method. First is the fact that the differences between any two properties make it impossible to relate the complexity of the task to the value of the property. A high-end property could be a relative “no brainer” while a particular mid-market home could have dozens of variables to be analyzed. The second reason is that basing fees on value places an obvious incentive on appraisers to estimate high, thus distorting reality. It is a violation of the appraiser’s Uniform Standards to charge a fee based upon a percentage of value.
Which of the following is NOT defined as a seller according to the PROPERTY DISCLOSURE ACT?
A Beneficiary of a trust B Contract purchaser or lessee of a ground lease C Owner D Any person who has never occupied the property
D
Any person who has never occupied the property
The Property Disclosure Act defines a seller as “every person or entity who is an owner, beneficiary of a trust, contract purchaser or lessee of a ground lease, who has an interest (legal or equitable) in residential real property.”
Which laws holds harmless a licensee to discover latent defects?
A Still v. Minor 1987 B State of Illinois v. Paragon, et al C Stubby v. Flag, 2000 D Munjal v. Baird & Warner, Inc. et al.
D
Munjal v. Baird & Warner, Inc. et al.
In Munjal v. Baird & Warner, Inc. et al., 2nd Dist (1985), the Illinois Appellate Court held that a broker has no duty to discover “latent” material defects in a property if the seller has not disclosed these defects prior to the sale.
Beginning after the 2013 renewal, individuals renewing or obtaining a managing broker’s license must complete how many CE credit hours?
A 4 B 6 C 24 D 12
C
24
Beginning after the 2013 renewal, individuals renewing or obtaining a managing broker’s license must complete the 24-hour broker management continuing education course each renewal period.
When the lender under a deed of trust requires title insurance, who would be the most likely person to pay for it?
A The mortgagee B The trustee C The trustor D The beneficiary
C
The trustor
“Trustor” is another name for the borrower and “trustee” is a “supposedly” neutral third party who holds naked legal title, the right to foreclose at the instructions of the beneficiary for non-payment of a promissory note. The beneficiary is the lender in a Deed of Trust. Even though it’s the lender who requires the insurance to protect his/her position, it’s the borrower who pays for it.
To create a joint tenancy relationship in the ownership of real estate, there must be unities of
A desires, ownership, claim of right, and possession. B title, interest, liens, and survivorship. C possession, time, interest, and title. D ownership, possession, heirs, and title.
C
possession, time, interest, and title.
This essentially means that all parties to the agreement share equally in all aspects of the property, including the length of time it’s been held. That means if one party sells or transfers interest in a joint tenancy relationship, his or her place is taken by another in the same capacity.
Within how many days does a change in managing brokers need to be reported to the IDFPR?
A 10 B 15 C 20 D 30
B
15
Any changes in managing brokers, branch or principal offices MUST BE reported in writing to IDFPR within 15 days after the change.
